A local net neutrality policy could boost the market dominance of international streaming providers such as Netflix, says an expert.<\/p>\n
Net neutrality is the concept of treating all web traffic equally. It further involves website owners and consumers not having to pay extra for a fast lane on the internet.<\/p>\n
The South African government has previously highlighted the importance of an open, equitable internet as part of a review of national information and communication technology (ICT) policy.<\/p>\n
“Everything has to be done at a policy level to ensure that a new digital divide is not created,” Joe Mjwara, of the department of telecommunications and postal services, said in parliament earlier this year.<\/p>\n
But Denmark-based research firm Strand Consult has found that an equitable internet has had unintended consequences.<\/p>\n
\u201cWe find in countries with hard net neutrality rules that Netflix maintains a top position as a most favoured app,” vice president of Strand Consult, Roslyn Layton, told Fin24.<\/p>\n
“No local or other competitor threatens their position.<\/p>\n
“Even companies that try to zero-rate their video app don’t touch Netflix’s dominance,\u201d said Layton.<\/p>\n
Online streaming provider Netflix is intent on expanding its market and rumours are circulating that the company will officially enter SA next year.<\/p>\n
Local players such as Times Media Group’s Vidi, Naspers’ ShowMax and MTN’s FrontRow have launched streaming services in a bid to preempt a Netflix launch in SA.<\/p>\n
Last month, Hong Kong firm PCCW also launched a streaming product dubbed ONTAPtv.com in South Africa while Orange Horizons has previously revealed to Fin24 that it plans to launch a video on demand service in 2016.<\/p>\n
Fast lanes<\/strong><\/p>\n Fast internet lanes, though, could be of benefit to smaller video on demand players such as Vidi, ShowMax, FrontRow and ONTAPtv, said Strand Consult.<\/p>\n \u201cTheoretically a fast lane, if it existed, would be of greatest benefit to the small startup,” said Layton.<\/p>\n “If you want to compete with Netflix with 65 million customers in 50 countries, there is no way a startup can invest in such a distribution system – especially the cost of licensing the content,\u201d said Layton.<\/p>\n \u201cBut if all a startup would have to do is pay for a better, faster carriage, then it could compete with Netflix. It’s counter-intuitive, but so it is,\u201d she added.<\/p>\n In January, streaming video giant Netflix said that it planned to expand its global reach by over 150 countries in the next two years.<\/p>\n Outside of the US, Netflix has moved into markets such as Australia while reports have indicated that Hong Kong, Singapore, South Korea, and Taiwan are next on its radar.<\/p>\n Fin24<\/a><\/p>\nMore on Netflix<\/h3>\n